Leases Leases

3 Months Ended

Mar. 31, 2019

As discussed in Note 2, “Significant Accounting Policies,” we elected the Topic 842 transition provision that allows entities to continue to apply the legacy guidance in Topic 840, Leases, including its disclosure requirements, in the comparative periods presented in the year of adoption. Accordingly, the Topic 842 disclosures below are presented as of and for the three-month period ended March 31, 2019, only.

We are a party to operating and finance leases primarily for our corporate and health plan offices. Our operating leases have remaining lease terms up to 10 years, some of which include options to extend the leases for up to 10 years. Our finance leases have remaining lease terms of 3 to 19 years, some of which include options to extend the leases for up to 25 years.

The components of lease expense were as follows:



	Three Months Ended March 31, 2019
	(In millions)
Operating lease cost	$	9

Finance lease cost:
Amortization of ROU assets	$	4
Interest on lease liabilities	4
Total finance lease cost	$	8

Supplemental consolidated cash flow information related to leases follows:



	Three Months Ended March 31, 2019
	(In millions)
Cash used in operating activities:
Operating leases	$	9
Finance leases	$	4
Cash used in financing activities:
Finance leases	$	1
ROU assets recognized in exchange for lease obligations:
Operating leases	$	94
Finance leases	$	241

Supplemental information related to leases, including location of amounts reported in the accompanying consolidated balance sheets, follows:



	March 31, 2019
	(Dollars in millions)
Operating leases
Other assets	$	83

Accounts payable and accrued liabilities	31
Other long-term liabilities	62
Total operating lease liabilities	$	93

Finance leases
Property, equipment, and capitalized software, net	$	237

Accounts payable and accrued liabilities	$	7
Finance lease liabilities	234
Total finance lease liabilities	$	241

Weighted average remaining lease term
Operating leases	4 years
Finance leases	17 years
Weighted average discount rate
Operating leases	5.5		%
Finance leases	6.6		%

Maturities of lease liabilities as of March 31, 2019, were as follows:



	Operating Leases			Finance Leases
	(In millions)
2019 (excluding the three months ended March 31, 2019)	$	27		$	16
2020	28			22
2021	18			22
2022	12			21
2023	9			21
Thereafter	9			311
Total lease payments	103			413
Less imputed interest	(10		)	(172		)
	$	93		$	241

Leases

The components of lease expense were as follows:



	Three Months Ended March 31, 2019
	(In millions)
Operating lease cost	$	9

Finance lease cost:
Amortization of ROU assets	$	4
Interest on lease liabilities	4
Total finance lease cost	$	8

Supplemental consolidated cash flow information related to leases follows:



	Three Months Ended March 31, 2019
	(In millions)
Cash used in operating activities:
Operating leases	$	9
Finance leases	$	4
Cash used in financing activities:
Finance leases	$	1
ROU assets recognized in exchange for lease obligations:
Operating leases	$	94
Finance leases	$	241

Supplemental information related to leases, including location of amounts reported in the accompanying consolidated balance sheets, follows:



	March 31, 2019
	(Dollars in millions)
Operating leases
Other assets	$	83

Accounts payable and accrued liabilities	31
Other long-term liabilities	62
Total operating lease liabilities	$	93

Finance leases
Property, equipment, and capitalized software, net	$	237

Accounts payable and accrued liabilities	$	7
Finance lease liabilities	234
Total finance lease liabilities	$	241

Weighted average remaining lease term
Operating leases	4 years
Finance leases	17 years
Weighted average discount rate
Operating leases	5.5		%
Finance leases	6.6		%

Maturities of lease liabilities as of March 31, 2019, were as follows:



	Operating Leases			Finance Leases
	(In millions)
2019 (excluding the three months ended March 31, 2019)	$	27		$	16
2020	28			22
2021	18			22
2022	12			21
2023	9			21
Thereafter	9			311
Total lease payments	103			413
Less imputed interest	(10		)	(172		)
	$	93		$	241